Guest Post By Jill Suskind

Talking to teens about money is an art form!

Remember the parents’ voices in the Charlie Brown movies?  Ever feel like your teen hears “wah wah wah wah” like Charlie Brown and his crew do when you bring up the subject?  So, how do we talk to our teens about money in a way that makes it real, makes it matter, and makes it last?

I like to keep in mind two main things when I talk to teens about money:  first, there’s what we say out loud about money; and second, there’s what we don’t say out loud about money.  In both cases, though, messages are sent and received, loud and clear.

These messages form the foundation of the financial education our children receive, so it’s important to give it some care and thought.   Here are four areas to consider:  allowance, needs vs. wants, giving, and goal-setting.

1. Allowance

If, for example, we give our teens an allowance by just handing them money each week with nothing tied to it, and let them spend it however they want, I wonder what they learn.  Do they learn, “Money just comes to me, and it doesn’t matter what I do with it”?  What does that translate into when our teens become adults?

What would they learn, then, if we said, “I’m going to put you in charge of purchasing this, that and the other thing, which I currently spend $xxx a week on.  This way you don’t have to ask me for money for those things and I’ll help you make great decisions around that money as well so you can learn what it takes to handle your money wisely.”

We certainly want to teach our children what money is:  Money is a form of exchange for goods and services and it’s one of the important tools that make our dreams come true. Because of this, it’s important to begin inspiring your children to create their own money. They can do this by offering their services to others or creating products that they can sell to others that solve a problem or fill a need.

When our teens are older, we then add, “You’re doing such a great job managing your money; we’re going to give you a raise in your allowance so that you can now be responsible for xxx, xxx and xxx. We’re still going to be helping you every step of the way.  You will be responsible for the right choices as well as any mistake you make with this money and that’s how we all learn.”

Just remember, as the adults in their lives, it becomes our job to provide them with the tools and information they need to become excellent money managers. The goal of giving an allowance this way is that they are fully responsible for the financial decisions of their lives by the time they are 16-18 years old. This way they can move out or move on to college and know what to do with their money.

2. Needs vs. Wants

If you have been reading my blog for a while, you already know I am a maverick in this area.  Lots of folks think it’s really valuable to have teens learn to identify what a “need” is and what a “want” is.  I beg to take a different position.  Why?  I think these words hold judgment in them, and I find that teens stop listening when we try to tell them what they need and what they want, based on OUR beliefs.

What would the teens in our lives learn if we said, “You can have whatever you’re willing to have” (excluding harmful things and those that are truly inconsistent with the values we are teaching them)?

I find that some things I think I NEED suddenly become not-so-necessary when I consider what I would have to do to get them.   A lot, in fact, gets taken care of in this framework of “Are you willing to do what it would take to get that?”

My thought process, when I am deciding whether or not to buy something, is: What would I need to sacrifice?  What would I need to do to get the money?  Am I willing to discipline myself to save for that thing?  Am I willing to wait for it?  Will I still want it by the time I have saved for it?

I prefer this context over “Do I need this or want it?” and trying to live within the confines of a disempowering money conversation based on a subjective values.  It reminds me that I, not my bank account, can determine what I can have.  Because, I can, ultimately, have whatever I am willing to have.

After all, when it comes down to it, I don’t want everything.  I just want what is IMPORTANT to me; something that is unique to me, and it doesn’t fit into a Needs vs. Wants diagram.

3. Giving

What do we say and not say about Giving to our teens?  Do we send the message that they can keep all their money and that adults will take care of charity?  Do we send them to ask for sponsors for fundraisers, and not expect them to be a sponsor?  What are they learning from this?  Do you think they learn, “You need to have a certain amount of money before you give some of it to causes that matter to you?  Or, do you need to be a certain age before you assume responsibility for how things go –in the greater sense?”

I believe that it’s important to raise our children on the ideas that we ALL can give, and we are ALL responsible for the greater good of humanity.  By living these values in real time, with real money, we teach our children how to view themselves and the difference they can make now AND for the rest of their lives.

4. Goal-setting

There are few conversations you could have with your teen about money that are as important as this one.  Once we set a goal and we know the value of that goal, we suddenly start to rearrange ourselves around this goal.

Think about how teens that are college-bound, for example, operate.  They see their grades and all of their activities in terms of “Will this help me get into college?”  As a teacher, when I see a student underperforming in school, I always ask them about their goals.  In almost EVERY case, underperformers either don’t have a goal that rides on their performance in school OR they don’t see the value of that goal, OR they don’t see themselves as having what it takes to reach that goal, so they aren’t committed to it.

Likewise, we organize our financial lives around our goals.  If we don’t have money goals that inspire or motivate us, OR if we don’t think we can set meaningful money goals and reach them, we spend and save accordingly.  When we have a clear goal and a clear reason for that goal that really matters to us, then we get really interested in how to achieve it.

Teens can set a long-term goal for their money, as soon as they can see that they have the tools to reach it and that starting now, when they are young, makes it SO much easier to reach.  (This is where you pull out the compound interest charts!)  The structure of this goal-setting conversation can result in a statement that goes something like this:

By the time I am 70 years old, I want to have a net worth of $X.  When I have this amount, I will be able to ____________ for myself and _______________ for others.  If I start now, I can reach this goal by doing 5 things:

1. 1. Talking about money with my parents and other people who know about it;
2. 2. Learning about money and engaging in lots of opportunities where I get to explore it;
3. 3. Practicing an effective money management strategy;
4. 4. Giving some of my money to a cause I care about;
5. 5. Aligning my mind so I learn to think about money like a wealth builder.

Note: This post is one of five in our series, Our Comprehensive Approach.  You can see the others by clicking Learn, Give, Practice, and Align at www.yourteensmoneyskills.com

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